DTE and Consumers Energy sue to pause Michigan's new political spending limits
The state's two largest utilities filed a federal lawsuit two days after voters approved Proposal 2, arguing the law infringes on First Amendment rights and applies too broadly to employees and their families.
By Nadia Rahman ·
DTE Energy and Consumers Energy filed a federal lawsuit on Thursday to block the immediate enforcement of Proposal 2, a measure approved by Michigan voters two days earlier.
The state's two largest electric and gas utilities argue that the new restrictions on political giving violate their constitutional rights to free speech and association. Proposal 2 was approved by more than 80% of the vote in Tuesday's election. The law prohibits direct or indirect contributions to Michigan politicians by the utilities or companies with more than $250,000 in state government contracts.
The ban extends to immediate family members and other individuals with close connections to the affected companies. The utilities claim the law is vague regarding who is covered and why utilities are specifically targeted. They argue this vagueness violates the due process clause of the 14th Amendment. The companies also contend the law violates the equal protection clause by impermissibly targeting utilities and a broad swath of people associated with them.
In a complaint filed with the US District Court for the Western District of Michigan, attorneys for the utilities stated that without an injunction, the companies will be forced to choose between surrendering their rights to political association and risking substantial penalties. They noted that policymakers benefit from hearing the utilities' perspectives on reliability, affordability, and clean energy, even if those views sometimes conflict with other stakeholders.
The suit names Michigan Bureau of Elections Director Jonathan Brater, Attorney General Dana Nessel, and Secretary of State Jocelyn Benson as defendants. Benson is currently the governor-elect. This is the second lawsuit filed to challenge Proposal 2. The Mackinac Center for Public Policy announced its own legal challenge on Tuesday night after it became clear that voters had approved the measure.
Maura Cowley, manager of the Michiganders for Money Out of Politics campaign, said the lawsuit was expected. She stated in a statement that the corporations opposing the measure had been preparing for this legal challenge since the proposal qualified for the ballot. Cowley said the group is confident the law will withstand scrutiny and is prepared to take on this and any future legal challenges.
The proposed law would expand existing bans on corporate donations to candidates. It would cover company presidents, chief executive officers, treasurers, board members, and people with substantial ownership interests. It also includes the immediate family members of those officials. The law restricts contributions to state and local party committees, candidates for state office, and members of the Michigan Public Service Commission.
Officials and family members could also not donate to entities affiliated with elected officials or candidates to pay for travel, meals, or conference fees. The measure requires disclosure by groups that reference candidates or ballot issues in issue ads. This is a change from current practices where some spending is done through employee-funded PACs or nonprofits that do not disclose donors.
Consumers Energy spokesperson Katie Carey said in a statement that the law unfairly targets a Michigan business along with its employees and their families. She noted that residents should not lose their First Amendment rights based on their place of employment. The lawsuit notes that one plaintiff is the 86-year-old mother of DTE's treasurer. The suit claims she would be barred from donating to political candidates even though she has no role at any utility.
The proposal does not prohibit contributions to independent expenditure super PACs allowed under the Citizens United ruling. The law includes a severability clause stating that if any portion is found void, invalid, or unenforceable, the remaining portions remain in effect. The US Supreme Court has generally held that political spending by corporations is protected speech, but courts have shown more favor toward narrowly tailored proposals aimed at limiting corruption.
